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Firing OLG chair Godfrey shows Liberals in ‘disarray,’ Hudak says

Paul Godfrey said he did not get a satisfactory explanation for why he was pushed out of his job at the Ontario Lottery and Gaming Corp.
(Nick Kozak for the Toronto Star)

By Richard J. Brennan and Robert BenzieQueen's Park Bureau

Fri., May 17, 2013

Premier Kathleen Wynne is being blamed for “chaos” at Ontario’s gambling agency that is threatening the cash-strapped province’s gaming revenue.

One day after Wynne fired Paul Godfrey as chair of the Ontario Lottery and Gaming Corp. — resulting in the board resigning en masse — Progressive Conservative Leader Tim Hudak warned of dire fiscal consequences due to a government that is “off the rails.”

“The Liberals are counting on over $1 billion from the so-called modernization strategy and all of a sudden they toss Paul Godfrey out the window, the board resigns, the finance minister says one thing, the premier says the other,” Hudak told reporters Friday.

“I mean, how’s this going to restore investor confidence in our province? How’s this going to bring any taxpayer confidence in our government? This looks very much like the Liberal government careening from one side of the road to the other.”

Hudak said when such a prominent businessman and public servant is “tossed overboard . . . this very much looks like a Liberal government in disarray, that doesn’t know which way it wants to go.”

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But a senior Liberal official maintained “we’re not stopping on modernization” of OLG and that president and CEO Rod Phillips would remain in charge of the organization.

Peter Wallace, the secretary of the cabinet and head of the Ontario public service, will serve as interim chair for the next few weeks while a permanent head is sought and a new board recruited.

In the meantime, deputy ministers Steve Orsini, Gail Beggs, Lynn Betzner, and associate deputy Greg Orencsak will sit on a temporary board to oversee the corporation.

To underscore the Liberals’ commitment to gambling expansion, the government released its revised funding formula for municipalities that host casinos.

Under the new regimen, OLG will provide an additional $50 million a year to communities with casinos by 2018. That’s especially good news for Niagara Falls and Windsor.

“Modernization is about more than benefiting one community or one facility; it’s about benefiting all Ontarians by providing more money for hospitals and community infrastructure projects across the province,” Finance Minister Charles Sousa said in a statement.

Godfrey, 74, president and CEO of Postmedia newspapers, said he didn’t get a satisfactory explanation from Sousa or Wynne as to why he was being sacked.

He said the board was instructed to modernize the gaming industry in Ontario with the goal of expanding gambling to bring in at least $1 billion more in revenue in order to avoid raising taxes.

“After three years, I believe it is a dramatically improved organization,” Godfrey said Thursday.

Bill Swirsky, one of the seven board members who quit in solidarity, said “without Paul and what he has put together . . . there is nothing there for a board to do.”

“We don’t like it,” said Swirsky, adding that the OLG has a long way to go to fully implement the government’s plans for the agency.

Godfrey’s dismissal came the same day as Mayor Rob Ford admitted a downtown Toronto casino was dead unless the province promised a $100-million hosting fee.

But, as first revealed by the Star, the city would receive just $53.7-million annually for a new facility and existing slots at Woodbine by 2018. (That’s $26.3 million more than the $27.4 million the city would have taken in under the previous hosting formula.)

A casino in Toronto or a surrounding municipality has been a key part of OLG’s “modernization” push to increase revenues to a provincial Liberal government desperate for money.

Sources insisted Friday the overhaul is continuing and it’s “business as usual” at an agency that reaps more than $1.7 billion to the treasury annually and that the government hopes will eventually bring in $3 billion a year.

“Ontario’s horse racing and breeding industry has been reeling since March 2012 when the government of Ontario announced the cancellation of the Slots at Racetracks Program,” Leslie said in a statement.

“Under Premier Wynne, our industry has seen the start of a number of positive steps, including the government’s announcement that horse racing will become an integrated partner in the government’s future gaming strategy.”

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